It's time to admit that bad journalism is enabling crowdfunding scampaigns

By James Robinson , written on October 3, 2014

From The News Desk

Yesterday, from Indiegogo's weekly email, I came across the campaign for Pavlok, a wearable wristband that shocks you every time you do something naughty, to help you break bad habits. In three days now, it has been featured on NPR, Fox News, The Colbert Report, Late Night with Jimmy Fallon, Business Insider, Engadget, ABC News, Fortune, the Huffington Post, among many, many others. Not all of this coverage was serious -- the Pavlok is one of those gimmicky, ridiculous tech ideas that just makes for good reading (or watching) -- but all of it is displayed like a badge of honor on the company's campaign page.

Worryingly, all of the coverage treats the Pavlok like it's an actual, real, ready to go thing and not what it actually is: a speculative idea in a very early stage of development.

Maybe the Pavlok will be amazing. I'm not accusing it of being a scam. (It is however a stupid idea. Aversion therapy has a questionable success rate because most people quickly become smart enough to stop shocking themselves so they can keep on doing the bad thing.) But at an early stage, it still has many of the hallmarks of a classic scampaign.

The Indiegogo pitch asks for only $50,000 (it's currently at $91,000). Even matched with a $200,000 seed funding round from last year, this puts the company well below the millions of dollars that are needed to get a piece of hardware to market. The accompanying campaign video is heavy on the concept of the product, with sharp graphics, music, and a persuasive pitch to the camera from co-founder Maneesh Sethi. But it's worryingly light on actual details. You see an early prototype on Sethi. It looks crude and from the sounds of it has a velcro strap. Every time the camera moves in for a close up, the video switches to an obviously computer enhanced image of what Pavlok imagines its finished product will look like. A customer testimonial features a man talking about how good Pavlok is, but you never see him using it.

And just like every other campaign that either straight lied or fell apart and never shipped, Sethi utters that magic crowdfunding message : Pavlok is all ready to go into production, it just needs a little cash to get there.

Even if there's no definite intention to deceive, the road to hell is always paved with good intentions. Making hardware is difficult. Things always go wrong in production. Not sometimes. Always. Crowdfunders often raise too little, naively expecting VC investment to definitely follow a successful campaign. I, for one, wouldn't put money on Pavlok shipping in April. Hopefully it ships, ever. And hopefully whatever its backers receive works as advertised, and does so safely.

Too often the press (and especially the tech press), pushed by having to file several stories a day and to generate pageviews at any cost, writes up crowdfunding campaigns like they're reviewing an actual existing product. None of the coverage of Pavlok treats it as the outline of something that might be a product, one day.

It's bad journalism that spurs bad investing. Supporting a crowdfunding campaign is speculative. There's no guarantee of a product and no guarantee of a return. And yet, too many backers view Kickstarter and Indiegogo as stores that they can go to pre-order something that will reliably arrive at their doorstep in a few predictable months.

This dynamic is playing itself out repeatedly as we speak.

The Body Dryer campaign from earlier in 2014, is now expecting rewards to arrive five months late, if at all, amid massive design overhauls and cries for refunds. TechCrunch's adoring write up, "Finally, Someone is Disrupting the Towel," was retweeted 578 times and shared 3,600 times on Facebook.

Mashable covered the Ritot smartwatch campaign, its more measured article also shared 3,600 times on social media. Days later the Ritot concept was outed as being complete fantasy, but with the help of tech coverage like Mashable's, the cat was out of the bag and Ritot was on its way to a $1.4 million haul.

The troubling reality is, journalists have deadlines and there are too many publicity hungry crowdfunders out their willing to help them out by badly overstating their hands. And s long as journalists fail to make the distinction in crowdfunding between a pitch and a real product, they'll continue making themselves complicit in the scam. This is one scenarios in which it's imperative to look before you leap.

[illustration by Brad Jonas for Pando]